The expansion of platform work has raised regulatory questions around the world. Previous research has explored issues of risk, security and employment conditions from a range of perspectives but there are few cross-country comparative studies.

This project compared digital platform employment and regulatory implications in China and Australia. It also examined digital platform labour disputes in Chinese courts with the aim to offer insight into how the rights and interests of platform labour providers can be better protected.

Despite the growth of digital platform employment in various forms and the increasing inadequacy of the existing labour law in regulating platform employment, neither Australia nor China has developed a new legal framework to offer a greater level of regulation and protection to those working in this sector and those receiving services.

A need for regulatory change?

There is also little research into what the legal constraints may be in practice, and what legislative/regulatory changes are needed to accommodate this growing form of labour deployment.

Through a study of Chinese court cases, this project explored in depth a key issue; liability for accidents. In Chinese law, when the nature of the contract between the worker and the platform is unclear, the liability is divided. This is because different rules are applied to ‘independent labour’ and ‘subordinate labour’. Civil law applies to the former, whereas labour law applies to the latter. Digital platform employment is a special form of employment that falls between the two categories.

Research questions

  1. What are the main modes of digital platform employment in China and Australia? What are the distinct characteristics and benefits of digital platform employment relative to regular employment?
  2. Under what institutional environments have digital platform employment emerged and developed in Australia and China respectively? What may be the societal impacts?
  3. What regulatory challenges do these developments present to Australia and China, and what lessons can be shared between the two countries in terms of regulatory efforts and achievements?
  4. What is the attitude and role of courts in resolving disputes between the Internet network platform and the labour provider in China within a civil law system?
  5. What may be the prospect of legal innovations to provide better protection to platform labour providers who fall outside the scope of labour law, in order to counter the wild expansion of digital capitalism at the expense of those under-/unprotected?

Method

To compare digital platform employment in Australia and China, the project made use of:

  • Literature search of journal articles, books, chapters, media reports, and grey literature
  • Semi-structured interviews with platform organisers, legal professionals, trade union officials, and platform workers
  • Review of court rulings and case reports in China and Australia.

The authors also analysed 102 cases from 2014 to 2019 of Chinese court decisions relating to disputes between Internet network platforms and labour providers.

Key findings and author suggestions

  • The digital platform economy has expanded much more rapidly in China than in Australia. In particular, digital platform employment in China constitutes a substantial and growing segment of informal employment, operating in a highly unregulated and competitive market.
  • Digital platform workers in both countries suffer from an ambiguous legal status in employment and are increasingly treated as independent contractors by the platform in order to evade employers’ responsibility and cost.
  • Current labour laws in Australia and China are inadequate in providing legal protection to digital platform workers.
  • There are far more legal disputes and court cases involving digital platforms and digital platform workers in China than in Australia, in large part due to the size of the workforce.
  • Both countries need to revise their current labour laws or develop new ones to offer better protection to this category of workers.
  • In China, digital platform workers, especially takeaway riders and couriers, suffer from work intensifications and poor remunerations. In Australia, a sizeable proportion of digital platform workers are paid less than the Australian minimum work standards per hour, and this occurs on both types of platforms (web-based and location-based). In addition, platforms in different industries have large differences in work remuneration. The higher-remunerated platforms are the platforms that provide professional services, and the lower-remunerated platform is the platform that provides clerical and information entry services. The difference is doubled.
  • Existing literature shows that the vast majority of digital platform workers do not have pension insurance. There may be two reasons for this phenomenon. First, most workers work part-time on platforms or work on multiple platforms at the same time, and their income from one platform may be less than 450AUD per month, which cannot meet the payment base required by the Superannuation Guarantee (Administration) Act; second, it is in the ‘service agreement’ signed by the digital platform workers and the platform company that they are defined as independent contractors or the platform company denies that they are the employer. However, as mentioned in the Victorian Government (2020) report, several platform companies have expressed their intention to pay pensions for practitioners.
  • In Australia, although there are relatively serious occupational injury problems in online car-hailing, food delivery and other industries, most of the digital platform workers do not have work-related injury insurance and compensation.
  • Digital platform workers in Australia and China suffer from a serious information asymmetry vis-à-vis the platform companies due to the algorithmic control by the latter. Most digital platform workers have no knowledge of the operating principle of the algorithm, lack information communication with platform companies, and are passive recipients of the calculation of work remuneration and consumer ratings.
  • With the rise of the digital platform economy, the protection of the rights and interests of digital platform workers has gradually attracted policy attention. The premise of solving this problem is how to determine the identity of the worker. It is argued that the existing ‘dichotomy’ (employee or non-employee) in employment status for the purpose of labour law is difficult to apply to the digital platform workers to meet their needs. Scholars put forward the idea of ​​establishing a third category of employment status, the ‘worker’ category, in which the worker will be entitled to partial labour protection.
  • The existing literature puts forward the necessity of establishing the third category, and the main points can be summarized as: platform practitioners are different from ‘independent contractors’, they lack the independence of ‘independent contractors’; they have more economic dependence on platform companies; although their labour process is indeed different from that of employees, it cannot completely deprive them of their due labour rights and interests. The literature also raises the difficulties and problems of establishing the third category. For example, the legislative process of the third category in a democratic country will be a long and complex process, which may lag behind the development speed of the platform economy; the legislative power of the federal and states (provinces) may vary. Fragmentation may create more confusion due to ambiguity in the definition of the third category; this will increase the complexity and difficulty of testing standards as platform practitioners work on multiple platforms at the same time.
  • In sum, after several years of observation and summary of digital platform employment, research and discussions have been gradually deepened and enriched. Whether it is policy regulation or academic research, a common starting point for digital platform employment governance is that platform workers should obtain corresponding rights and interests protection. The crux of the problem is that the platform employment pattern has undergone fundamental changes compared with conventional labour relations, making it impossible to directly be incorporated into the current labour law. In this sense, the government’s regulatory framework and governance ideas for platform employment should not only aim at addressing the current problems but also deal with the increasingly diverse and complex employment forms in the digital age.

What is the attitude and role of courts in resolving disputes?

The approach of the courts is conservative, pragmatic and yet sympathetic toward labour in some cases, where such leniency makes a significant impact. A level of judicial flexibility does exist, but the exercise of such discretion in favour of labour is contingent upon, amongst other things, the judges’ ideological values.

While the study reveals the judges’ critical role as institutional actors at the micro level, the protection of millions of workers in China’s informalised labour market, where labour law enforcement is ineffective, cannot be contingent upon the goodwill and moral conscience of a few judges. Instead, legal provisions should be introduced to institutionalise protection that goes beyond the current labour law both conceptually and substantively.

What may be the prospect of legal innovations to provide better protection?

The concept of socialization of contract service should be central to platform employment. A multi-level platform employment security network should be developed to provide a better balance between economic efficiency and social justice.

Given time, the risks associated with individual workers, as borne out in the dispute cases (i.e., unemployment due to injury, poverty in old age, poverty due to lack of social security protection), will aggregate into a substantial burden of social risks that cannot be easily written off.

Research outputs

Researchers

Monash University

Tianyu Wang, China Academy of Social Sciences